Overview of Entrepreneurial Process | My Assignment Tutor

BUS322ENTREPRENEURSHIPORGANIZATIONOverview of Entrepreneurial Process Entrepreneursees a Consumer’sComplaints orUnsatisfied Need Find theOpportunityfrom theComplaints Come upWith anInnovative Idea Plan & DesignProduct fromInnovative Idea Make neededAdjustments andFinalize theProduct Design & RunMVP(s)To test theProduct & Market FormTheCompany Plan for theNeededResources Acquire &AllocateResources DevelopMarketingAnd OperatingStrategy DevelopDetailOperation Plan Daily OperationDevelopVision & MissionStatements GainFinancialSupport DevelopDetailOperation Plan EntrepreneurUnderstandNeeded Skills &Knowledge The entrepreneurial process:opportunity, resources and organization• focusing the resources inpursuit of the opportunity• configuring the resourcesto shape theorganization• making the organizationto fit the opportunity itaims to exploitThe entrepreneurial process:Focus, Fit, and ConfigurationThe fundamental task of the entrepreneur is tocreate or to change an organization in order toorganize the resources to create a new value.• The entrepreneur may create a new organizationor develop an existing one.• Whichever they choose, they create a neworganizational world.• Organizing/controlling resources within theorganization is the means to create new value.OrganizationCONCEPT OFORGANIZATIONImportant concepts of organization include:1. Organization as a coordinator of actions2. Organization as an independent agent3. Organization as a network of contracts4. Organization as a collection of resources5. Organization as a system6. Organization as a processor of informationConcepts of Organization1. Organization as a coordinator of actions• Organization has goals, and the people aim toachieve the same goals as a group• Organization acts to align and direct the actions ofindividuals towards the achievement of those goals• Organization is a framework for coordinating tasks• Although having different tasks, people in anorganization work together and coordinate with oneanotherConcepts of Organization2. Organization as an independent agent (entity) •An agent is something that has its own identity.Business organization is regarded as a legal entity, separate from the identities of its owners andmanagers.• Organization has rights and responsibilities which aredistinct from those of its creators and managers.• The organization takes actions on its own behalf andhas its own distinguishing properties.• This concept is important from a social and legalperspective.Concepts of Organization3. Organization as a network of contracts• Organizations are made up of people who contribute theirlabor on the basis that they will receive something in return.• This concept is based on the notion that people workwithin a framework of agreements defining thecontribution that each individual shall make and whatthey can expect from the organization in return.• Contracts may be quite formal and legally recognized, forexample a contract of employment. Frequently, however,a major part of the contract will not be formalized.• Many of the commitments and responsibilities areunwritten, and will rely on manager’s directions to define.Concepts of Organization4. Organization as a collection of resources• Organizations are created from resources includingcapital, people and productive assets such asbuildings and machinery.• The resource-based view of the firm sees it in terms ofthe collection of resources that make it up, which canbe bought and sold through open markets.• What makes a firm unique is the combination ofresources. Innovation is simply a new combination ofresources.• Having access to appropriate resources and usingthem both creatively and efficiently is central toentrepreneurial success.Concepts of Organization5. Organization as a system• A system is a coordinated body of things, or elements,(resources) arranged in a pattern of relationships.• Every element has its unique function. But the entiresystem can function productively only when allelements (resources) are functioning well.• The notion of organization as a system develops fromthe idea that a firm takes resource inputs andattempts to convert them into outputs of higher value.• The greater the value that is added, the moreproductive the system.Concepts of Organization6. Organization as a processor of information• Information is a critical part of business successbecause properly use of information leads toknowledge, and knowledge can lead to success.• The organization can be thought of as a device forprocessing information, for example information onwhat needs the customer has, what products willsatisfy those needs, how they can be prepared anddelivered efficiently, how their benefits can becommunicated to customers, and so on.• In this view, the performance of the firm is determinedby the quality of the information it has and how well ituses it.Concepts of OrganizationTYPES OFORGANIZATIONTYPES OF BUSINESS ORGANIZATION•Three main types of businesses:•Sole proprietorshipone owner, full liability, cannot sell company•PartnershipPartners equal share, full liability, cannot sellcompany•CorporationOwnership is per stock shares, limited liability, cansell stocksLO5Percentage of FirmsPercentage of Sales RevenueSoleProprietorships Partnerships(14%)(4%)Corporations(18%)Sole Proprietorships(72%)Corporations(82%)Partnerships(10%)2-16TYPES OF BUSINESS ORGANIZATIONORGANIZATIONHIERARCHYOrganizational hierarchy refers to how an organization isorganized. In this system, the working relationshipbetween the owner, directors, managers and all theemployees within the firm is distinct and clearly defined.An organizational hierarchy defines:• The function and responsibility of each position• The chain of command (vertical)• The network of coordination (horizontal)• The working relationshipOrganizational HierarchyOrganizational Hierarchy• Function & responsibilityof each position• Chain of command(vertical line)• Network of coordination(horizontal line)• The working relationship(all)BUSINESSNETWORKA business organization can not exist in isolation. It will bein contact with a whole range of other organizations.Understanding the nature of the networks is important tothe success of the entrepreneurial venture.Business Network may include:• Businesses of same kind• Marketing area or location• Suppliers• Customers• Associations• GovernmentBusiness NetworkAn extended organization is one which uses theresources of other organizations in its network to achieveits goals.Extended OrganizationEXAMPLESResources NeededLong-Term: (after 2 Years)I would open all 7 programs after two years.• Human resources• Executive Officers: 2• Teaching faculty: 5 part time• Administrative Staff: 5• Operating resources• 5 offices + 1 meeting room + 4 Classrooms• Office Equipment & Teaching Equipment• Financial resources• About 60KMr. Michael’s Entrepreneurial Business Board Mr. Michael’s Entrepreneurial BusinessCEOAdministrationDivisionStudentConsultation Finance Support Office Healthcare Education Repair Edu House Education FashionEducationDivision(—————- 5 staffs —————)Long-TermOrganizationChart(—————- 5 teachers —————)

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